Gold Bounces Back from Six-Week Low as Central Banks Maintain Support

Gold prices are on track for their first weekly gain in four weeks after a 2% rebound from a six-week low. Spot gold rose 0.40% to $4,358.57, while December futures fell 0.26% to $4,388.10.

The price action on Friday reflects the ongoing tension between the metal's headwinds and its support. The Federal Reserve raised its target range to 3.75%-4.00% on Wednesday, signaling more tightening ahead, while the 10-year Treasury yield sits at 5.004%, near its highest level since July 2007.

However, central banks have been buying gold in large quantities, with 244 tonnes purchased in Q1 and 289 tonnes in Q2. This sovereign bid has helped defend the $4,300 floor under XAU/USD.